Bajaj Finserv Ltd Auditor Reports

on the Consolidated Financial Statements

To The Members of Bajaj Finserv Ltd.

Opinion

1. We have audited the accompanying consolidated financial statements of Bajaj Finserv Ltd.

(the Holding Company or the Parent or the Company) and its subsidiaries (the parent and its subsidiaries together referred to as the Group), its associates and joint venture, which comprise the consolidated Balance Sheet as at 31 March 2025 and the consolidated Statement of Profit and Loss (including Other Comprehensive Income), the consolidated Statement of Changes in Equity and consolidated Statement of Cash Flows for the year ended on that date, and notes to the consolidated financial statements, including a summary of material accounting policy information and other explanatory information (the consolidated financial statements).

2. In our opinion and to the best of our information and according to the explanations given to us and based on the consideration of reports of other auditors on separate financial statements of such subsidiaries, associates and joint venture as were audited by the other auditors, the aforesaid consolidated financial statements give the information required by the Companies Act, 2013 (the Act) in the manner so required and give a true and fair view in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies (Indian Accounting Standards) Rules, 2015, as amended, (Ind AS) and other accounting principles generally accepted in India, of the consolidated state of affairs of the Group, its associates and joint venture as at 31 March 2025, and its consolidated profit and other comprehensive income, consolidated changes in equity and its consolidated cash flows for the year ended on that date.

Basis for opinion

3. We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities under those SAs are further described in the Auditors responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the Group, its associates and joint venture in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (ICAI) together with the ethical requirements that are relevant to our audit of the consolidated financial statements under the provisions of the Act, and the rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence we have obtained along with the consideration of audit reports of the other auditors referred to in the Other matters paragraph below is sufficient and appropriate to provide a basis for our opinion on the consolidated financial statements.

Key audit matters

4. Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current year. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

The following key audit matters were reported to us by joint auditors of Bajaj Finance Ltd., a subsidiary of the Holding Company, which are reproduced by us as under:

Sr. No. Key audit matter	How the matter was addressed in our audit
1 Assessment of impairment loss allowance based on expected credit loss (ECL) on loans	The procedures performed by us included the following:
As at 31 March 2025, the outstanding balances of loans granted by the Company aggregated to C 310,761.52 crore and the associated impairment loss allowance recognised in the books aggregated to C 6,402.36 crore. The impairment loss allowance is determined in accordance with the expected credit loss (ECL) model specified under Ind AS 109 Financial Instruments and involves exercise of judgment by the Management in estimating the expected losses using components of ECL such as probability of default (PD), and loss given default (LGD) and exposure at default (expected balance at default together with expected drawdown from committed lines) (EAD), staging of loans, etc.	• Understood and evaluated the design and tested the operating effectiveness of the key controls put in place by the Companys Management over the:
Quantitative factors like days past due, behaviour of the loan portfolio, historical losses incurred on defaults, macroeconomic data points and recovery post default, and qualitative factors like nature of the underlying loan, deterioration in credit quality, correlation of macroeconomic variables to determine expected losses, probability weights applied to reflect future economic conditions, judgment in relation to management overlays and related Reserve Bank of India (RBI) guidelines, to the extent applicable, etc. are also taken into account in the ECL computation.	i. assumptions used in the calculation of ECL and its various aspects such as the determination of PD, LGD, EAD, staging of loans, etc.;
In view of the significant management judgment around determination of impairment loss and the complexity of the ECL model, we determined this to be a key audit matter.	ii. completeness and accuracy of source data used by the Management in the ECL computation;
	iii. approval of changes to ECL methodology and models through the Companys governance framework; and
	iv. computation of ECL.
	• Assessed the Companys accounting policy in respect of loans and related ECL provisioning for compliance with Ind AS 109 Financial Instruments;
	• With the assistance of auditors experts, verified the appropriateness of the methodology and models used by the Company and assessed reasonableness of the assumptions used within the computation process to determine the impairment loss allowance as per the requirements of Ind AS 109 Financial Instruments and ECL policy of the Company;
	• Tested, on a sample basis, the completeness and accuracy of the source data used;
	• Recomputed the impairment loss allowance for a sample of loans spread across the portfolios, to check the arithmetical accuracy and compliance with the ECL methodology approved by the Board of Directors of the Company;
	• Evaluated the reasonableness of the assumptions and judgments involved in the management overlays forming part of the impairment loss allowance, and the related approvals;
	• Evaluated the adequacy of presentation and disclosures in relation to impairment loss allowance in the financial statements.
2 Information technology (IT) systems and controls impacting financial reporting	The procedures performed by us included the following:
The IT environment of the Company is complex and involves a large number of independent and interdependent IT systems used in the operations of the Company for processing and recording a large volume of transactions.	• Involved our technology specialists to obtain an understanding of the IT environment, IT applications and related infrastructure and to assess the controls relevant to financial reporting.
As a result, there is a high degree of reliance and dependency on such IT systems for the financial reporting process of the Company.	• Evaluated the design and tested the operating effectiveness of relevant IT general controls over the in-scope IT systems and IT dependencies identified as relevant for our audit of the financial statements and financial reporting process of the Company.
Further, the Company migrated its loan book from its legacy loan management system (LMS) to another LMS during the year.	• On such in-scope IT systems, tested key IT general controls with respect to the following domains:
Appropriate IT general controls and IT application controls are required to ensure that such IT systems are able to process the data as required, completely, accurately, and consistently for reliable financial reporting.	- Program change management, which includes that program changes are moved to the production environment as per defined procedures and relevant segregation of environment is ensured;
We have identified key IT systems (inscope IT systems) which have an impact on the financial reporting process and the related controls testing as a key audit matter because of the complexity of the IT systems and high level of dependency on these systems for processing of financial transactions and their impact on the financial reporting process.	- User access management, which includes user access provisioning, de-provisioning, access review, password management, sensitive access rights and segregation of duties to ensure that privilege access to applications, operating systems and databases in the production environment were granted only to authorised personnel;
	- Program development, which includes controls over IT application development or implementation and related infrastructure, data migration from one LMS to another LMS;
	- IT operations, which includes job scheduling, monitoring, data backup and recovery;
	- Performed procedures to assess the completeness and accuracy of data migrated from the legacy LMS to the new LMS
	• Evaluated the design and tested the operating effectiveness of relevant key IT dependencies within the key business processes, which included testing automated controls, automated calculations/accounting procedures, interfaces, segregation of duties and system generated reports, as applicable.
	• Communicated with the Management and those charged with governance and tested a combination of compensating controls, remediated controls and/ or performed alternative audit procedures, where necessary.

The following key audit matters were reported by joint auditors of Bajaj Finance Ltd. pertaining to Bajaj Housing Finance Ltd., a step-down subsidiary of the Holding Company, which are reproduced by us as under:

Sr. No. Key audit matter	How the matter was addressed in our audit
1 Allowances for expected credit loss (‘ECL)	Our audit approach
Allowances for expected credit losses (ECL): as at 31 March 2025, the carrying value of loan assets carried at amortised cost, aggregated C 99,512.86 crore (net of allowance for expected credit loss C 577.86 crore) constituting approximately 97% of the Companys total assets. Significant judgment is used in classifying these loan assets and applying appropriate measurement principles. ECL on such loan assets carried at amortised cost is a critical estimate involving greater level of management judgment. As part of our risk assessment, we determined that the ECL on such loan assets has a high degree of estimation uncertainty, with a potential range of reasonable outcomes for the standalone financial statements. The elements of estimating ECL which involved increased level of audit focus are the following:	We have examined the policies approved by the Board of Directors of the Company that articulate the objectives of managing each portfolio and their business models. We have also verified the methodology adopted for computation of ECL (ECL Model) that addresses policies approved by the Board of Directors, procedures and controls for assessing and measuring credit risk on all lending exposures carried at amortised cost. Additionally, we have confirmed that adjustments to the output of the ECL Model are consistent with the documented rationale and basis for such adjustments and that the amount of adjustments have been approved by the Audit Committee of the Board of Directors. Our audit procedures related to the allowance for ECL included the following, among others:
• Qualitative and quantitative factors used in staging the loan assets carried at amortised cost;	Testing the design and operating effectiveness of the following:
• Basis used for estimating probabilities of default (PD), loss given default (LGD) and exposure at default (EAD) at product level with past trends;	• Completeness and accuracy of the EAD and the classification thereof into stages consistent with the definitions applied in accordance with the policy approved by the Board of Directors including the appropriateness of the qualitative factors to be applied;
• Judgments used in projecting economic scenarios and probability weights applied to reflect future economic conditions; and	• Completeness, accuracy and appropriateness of information used in the estimation of the PD and LGD for the different stages depending on the nature of the portfolio and
• Adjustments to model driven ECL results to address emerging trends.	• Accuracy of the computation of the ECL estimate including reasonableness of the methodology used to determine macro-economic overlays and adjustments to the output of the ECL model.
	Test of details on a sample basis in respect of the following:
	• Accuracy and completeness of the input data such as period of default and other related information used in estimating the PD.
	• The mathematical accuracy of the ECL computation by using the same input data as used by the Company.
	• Completeness and accuracy of the staging of the loans and the underlying data based on which the ECL estimates have been computed.
	• Evaluating the adequacy of the adjustment after stressing the inputs used in determining the output as per the ECL model to ensure that the adjustment was in conformity with the overlay amount approved by the Audit Committee of the Company.
2 Information technology (IT) systems and controls impacting financial controls	Our audit approach
The Companys key financial accounting and reporting processes are highly dependent on information systems including automated controls in systems, such that there exists a risk that gaps in the IT control environment could result in the financial accounting and reporting records being misstated.	Key IT audit procedures performed included the following, but not limited to:
Amongst its multiple IT systems, we scoped in systems that are key for overall financial reporting.	• For testing the IT general controls, application controls and IT dependent manual controls, we involved IT specialists as part of the audit.
Appropriate IT general controls and application controls are required to ensure that such IT systems are able to process the data, as required, completely, accurately and consistently for reliable financial reporting.	• Obtained a comprehensive understanding of IT applications landscape implemented at the Company. It was followed by process understanding, mapping of applications to the same and understanding financial risks posed by people, process and technology.
We have identified IT systems and controls as a key audit matter considering the high level of automation, significant number of systems being used by Management and the complexity of the IT architecture and its impact on overall financial reporting process.	• Key IT audit procedures includes testing design and operating effectiveness of key controls operating over user access management (which includes user access provisioning, de-provisioning, access review, password configuration review, segregation of duties and privilege access), change management (which include change release in production environment are compliant to the defined procedures and segregation of environment is ensured), computer operations (which includes testing of key controls pertaining to backup, incident management and data center security), System interface controls. This included testing that requests for access to systems were appropriately logged, reviewed, and authorised.
	• In addition to the above, the design and operating effectiveness of certain automated controls, that were considered as key internal system controls over financial reporting were tested using various techniques such as inquiry, review of documentation/ record/ reports, observation, and re-performance.

The following key audit matters were reported by joint auditors of Bajaj Finance Ltd., pertaining to Bajaj Financial Securities Ltd., a step-down subsidiary of the Holding Company, which are reproduced by us as under:

Sr. No. Key audit matter	How the matter was addressed in our audit
1 IT systems and controls	We performed the following procedures on the IT infrastructure and applications relevant to financial reporting:
Financial accounting and reporting processes, especially in the financial services sector, are fundamentally reliant on IT systems and IT controls to process significant transaction volumes, hence we identified IT systems and controls over financial reporting as a key audit matter for the Company.	We involved our IT specialists for assessment of the IT systems and controls over financial reporting.
Automated accounting procedures and IT environment controls, which include IT governance, general IT controls over program development and changes, access to programs and data and IT operations, are required to be designed and to operate effectively to ensure reliable financial reporting.	Understood general IT controls over key financial accounting and reporting systems (referred to as in-scope systems) which covered access controls, program/system changes, program development and computer operations.
	Tested the design and operating effectiveness of the Companys IT access control over the information system that are important to financial reporting.
	Carried the test of controls with respect to the IT general controls. This included testing that requests for access to systems were appropriately reviewed and authorised.
	Tested the Companys periodic review of access rights. Carried test of controls with respect to changes to systems for appropriate approval and authorisation.

Other information

5. The Holding Companys Board of Directors are responsible for the other information. The other information comprises the information included in the Holding Companys annual report but does not include the consolidated financial statements and our auditors report thereon. The other information is expected to be made available to us after the date of this auditors report.

6. Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

7. In connection with our audit of the consolidated financial statements, our responsibility is to read the other information, compare it with the financial statement of the subsidiary audited by the other auditor, to the extent it relates to their entities and in, doing so, place reliance on the work of the other auditors, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed and based on the work done and audit report of other auditors, we conclude that there is a material misstatement of this other information, we are required to report that fact.

8. When we read the annual report, if we conclude that there is a material misstatement therein, we are required to communicate the matters to those charged with governance and take appropriate action as applicable under the relevant laws and regulations.

Responsibilities of management and those charged with governance for the consolidated financial statements

9. The Holding Companys Board of Directors are responsible for the preparation and presentation of these consolidated financial statements, that give a true and fair view of the consolidated state of affairs, consolidated profit and other comprehensive income, consolidated changes in equity and consolidated cash flows of the Group including its associates and joint venture is in conformity with the Indian Accounting Standards prescribed under section 133 of the Act read with the Companies

(Indian Accounting Standards) Rules, 2015, as amended and other accounting principles generally accepted in India. The respective Board of Directors of the companies included in the Group and of its associates and joint venture are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Group and of its associates and joint venture and for preventing and detecting frauds and other irregularities; selection of the appropriate accounting software for ensuring compliance with applicable laws and regulations including those related to retention of audit logs; the selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring accuracy and completeness of the accounting records, relevant to the preparation and presentation of the consolidated financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the consolidated financial statements by the Directors of the Holding Company, as aforesaid.

10. In preparing the consolidated financial statements, the respective Board of Directors of the companies included in the Group and of its associates and joint venture are responsible for assessing the ability of each company to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

11. The respective Board of Directors of the companies included in the Group and of its associates and joint venture are responsible for overseeing the financial reporting process of the Group and of its associates and joint venture.

Auditors responsibilities for the audit of the consolidated financial statements

12. Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

13. As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

13.1 Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

13.2 Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3) (i) of the Act, we are also responsible for expressing our opinion on whether the Holding Company has adequate internal financial controls with reference to the consolidated financial statements and the operating effectiveness of such controls.

13.3 Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the management.

13.4 Conclude on the appropriateness of managements use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability of the Group and its associates and joint venture entities to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors report. However, future events or conditions may cause the Group and its associates and joint venture to cease to continue as a going concern.

13.5 Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

13.6 Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group and its associates and joint venture to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the audit of financial statements of such entities included in the consolidated financial statements of which we are the independent auditors. For the other entities included in the consolidated financial statements, which have been audited by other auditors, such other auditors remain responsible for the direction, supervision and performance of the audits carried out by them. We remain solely responsible for our audit opinion.

14. We communicate with those charged with governance of the Holding Company and such other entities included in the consolidated financial statements of which we are the independent auditors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

15. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

16. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current year and are therefore the key audit matters. We describe these matters in our auditors report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Other matters

17. The auditors of Bajaj Allianz Life Insurance Company Ltd. (BALIC), a subsidiary, have reported that determination of the following as at and for the year ended 31 March 2025 is the responsibility of the BALICs Appointed Actuary (the Appointed Actuary) -

a. The actuarial valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists. The actuarial valuation of these liabilities has been duly certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the Insurance Regulatory and Development Authority of India (IRDAI) and the Institute of Actuaries of India in concurrence with the IR DAI;

b. Other adjustments and judgments, confirmed by the Appointed Actuary in accordance with Indian Accounting Standard 104 - Insurance Contracts are as under:

i. Assessment of contractual liabilities based on classification of contracts into insurance contracts and investment contracts;

ii. Valuation and classification of deferred acquisition cost and deferred origination fees, if any;

iii. Grossing up and classification of the reinsurance assets and policy liabilities; and

iv. Liability adequacy test as at the reporting dates.

The auditors of BALIC have relied upon the Appointed Actuarys certificate in this regard for forming their opinion on the aforesaid mentioned items.

Our opinion on the consolidated financial statements is not modified in respect of the above matters.

18. The actuarial valuation of liabilities in respect of claims Incurred But Not Reported (IBNR) and claims Incurred But Not Enough Reported (IBNER) of Bajaj Allianz General Insurance Company Ltd. (BAGIC), a subsidiary, is the responsibility of the BAGICs Appointed Actuary. The actuarial valuation of these liabilities as at 31 March 2025 has been duly certified by the Appointed Actuary. The Appointed Actuary has also certified that in his opinion, the assumptions for such valuation are in accordance with Ind AS 104 Insurance Contracts, Ind AS 109 Financial Instruments, guidelines and norms, issued by IRDAI and Institute of Actuaries of India in concurrence with the IRDAI. We have relied upon the Appointed Actuarys certificate in this regard for forming opinion.

Our opinion on the consolidated financial statements is not modified in respect of the above matter.

19. The consolidated financial statements include the audited financial statements of six subsidiaries, whose financial statements reflect total assets of C 599,272.57 crore (before consolidation adjustments) as at 31 March 2025, total revenue of C 101,911.16 crore (before consolidation adjustments), total net profit after tax of C 16,829.90 crore (before consolidation adjustments) and net cash outflow of C 229.09 crore (before consolidation adjustments) as at year ended 31 March 2025 as considered in the consolidated financial statements, which have been audited by their respective independent auditors.

The independent auditors reports on financial statements of these entities have been furnished to us and our opinion on the consolidated financial statements, in so far as it relates to the amounts and disclosures included in respect of these entities, is based solely on the report of such auditors and the procedures performed by us are as stated in paragraph above.

20. The consolidated financial statements also include the Groups share of net profit after tax of C 0.18 crore (before consolidation adjustments) for the year ended 31 March 2025, in respect of one joint venture (consolidated) whose financial statements have not been audited by us. These financial statements have been audited by other auditors whose audit reports have been furnished to us by the Management, and our opinion on the statement, in so far as it relates to the amounts and disclosures included in respect of these entities, is based solely on the report of such auditors and the procedures performed by us are as stated in paragraph above.

21. The consolidated financial statements also includes the Groups share of net profit after tax of C 17.81 crore for the year ended 31 March 2025, as considered in the consolidated financial statements, in respect of two associates of the Group, whose financial statements have not been audited by us. These financial statements have been audited by other auditors whose audit reports have been furnished to us by the Management, and our opinion on the statement, in so far as it relates to the amounts and disclosures included in respect of these entities, is based solely on the report of such auditors and the procedures performed by us are as stated in paragraph above.

22. Our opinion on the consolidated financial statements, and our Report on other legal and regulatory requirements below, is not modified in respect of the above matters with respect to our reliance on the work done and the reports of the other auditors and the financial statements certified by the Management.

Report on other legal and regulatory requirements

23. As required by section 143(3) of the Act, based on our audit and on the consideration of audit reports of the other auditors on separate financial statements of such subsidiaries, associates and joint venture as were audited by other auditors, as noted in the other matters paragraph, we report, to the extent applicable, that:

23.1 We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit of the aforesaid consolidated financial statements.

23.2 In our opinion, proper books of account as required by law relating to preparation of the aforesaid consolidated financial statements have been kept so far as it appears from our examination of those books and the reports of the other auditors.

23.3 The consolidated Balance Sheet, the consolidated Statement of Profit and Loss (including Other Comprehensive Income), the consolidated Statement of Changes in Equity and the consolidated Statement of Cash Flow dealt with by this report are in agreement with the relevant books of account maintained for the purpose of preparation of the consolidated financial statements.

23.4 In our opinion, the aforesaid consolidated financial statements comply with the Ind AS specified under section 133 of the Act read with the relevant rules thereunder.

23.5 On the basis of the written representations received from the directors of the Holding Company, taken on record by the Board of Directors of the Holding Company and the reports of the statutory auditors of its subsidiary companies, associate companies and joint venture incorporated in India, none of the directors of the Group companies, its associate companies and joint venture incorporated in India are disqualified as on 31 March 2025 from being appointed as a director in terms of section 164(2) of the Act.

23.6 With respect to the adequacy of internal financial controls with reference to the consolidated financial statements of the Holding Company, its subsidiary companies, associate companies and joint venture incorporated in India and the operating effectiveness of such controls, refer to our separate report in Annexure A.

23.7 In our opinion and according to the information and explanations given to us and based on the reports of the statutory auditors of such subsidiary companies, associate companies and joint venture incorporated in India which were not audited by us, the remuneration paid during the current year by the Holding Company, its subsidiary companies, associate companies and joint venture incorporated in India to its directors is in accordance with the provisions of section 197 of the Act. The remuneration paid to any director by the Holding Company, its subsidiary companies, associate companies and joint venture incorporated in India is not in excess of the limit laid down under section 197 of the Act.

24. With respect to the other matters to be included in the Auditors Report in accordance with rule 11 of the Companies (Audit and Auditors) Rules, 2014 as amended, in our opinion and to the best of our information and according to the explanations given to us and based on the consideration of audit reports of the other auditors on separate financial statements of such subsidiaries, associates and joint venture, as noted in the other matters paragraph:

24.1 The consolidated financial statements disclose the impact of pending litigations as at 31 March 2025 on the consolidated financial position of the Group, its associates and joint venture - Refer note 42A to the consolidated financial statements.

24.2 Provision has been made in the consolidated financial statements, as required under the applicable law or Ind AS, for material foreseeable losses, if any, on long-term contracts including derivative contracts.

Refer note 5 and note 46(5) of the consolidated financial statements.

24.3 There has been no delay in transferring amounts required to be transferred, to the Investor Education and Protection Fund by the Holding Company and/or its subsidiary companies, associate companies and joint venture incorporated in India during the year ended 31 March 2025.

24.4 The respective Managements of the Holding Company, its subsidiaries, associates and joint venture incorporated in India whose financial statements have been audited under the Act have represented to us and the other auditors of such subsidiaries, associates and joint venture respectively, to best of their knowledge and belief, that no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Holding Company or any of such subsidiaries, associates and joint venture to or in any other person(s) or entity(ies), including foreign entities (Intermediaries), with the understanding, whether recorded in writing or otherwise, that the Intermediaries shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Holding Company or any of such subsidiaries, associates and joint venture (Ultimate Beneficiaries) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries. Refer note 46(15) to the consolidated financial statements.

24.5 The respective Managements of the Holding Company, its subsidiaries, associates and joint venture which are companies incorporated in India whose financial statements have been audited under the Act have represented to us and the other auditors of such subsidiaries, associates and joint venture respectively, to best of their knowledge and belief, that no funds have been received by the Holding Company or any of such subsidiaries, associates and joint venture from any person(s) or entity(ies), including foreign entities (Funding Parties), with the understanding, whether recorded in writing or otherwise, that the Holding Company or any of such subsidiaries, associates and joint venture shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Parties (Ultimate Beneficiaries) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries. Refer note 46(15) to the consolidated financial statements.

24.6 Based on such audit procedures, that have been considered reasonable and appropriate in the circumstances, performed by us and those performed by auditors of the subsidiaries, associates and joint venture incorporated in India whose financial statements have been audited under the Act, nothing has come to our or other auditors notice that has caused us or other auditors to believe that the representation under paragraph 24.4 and 24.5 contain any material misstatement.

24.7 In our opinion and according to the information and explanations given to us, the dividend declared and paid during the year by the Holding Company is in compliance with section 123 of the Act.

24.8 Based on our examination which included test checks and that performed by respective auditors of the subsidiaries, associates and joint venture which are the companies incorporated in India whose financial statements have been audited under the Act, the holding company, subsidiaries, associates and joint venture have used an accounting software for maintaining its books of account which has a feature of recording audit trail facility (edit log) and the same has operated throughout the year for all relevant transactions recorded in the software. Further, during the course of our audit, we and respective auditors of the above referred subsidiaries, associates and joint venture did not come across any instance of audit trail feature being tampered with.

Additionally, the audit trail has been preserved by the Holding Company and above referred subsidiaries, associates and joint venture as per the statutory requirements for record retention.

25. With respect to the matters specified in paragraphs 3(xxi) and 4 of the Companies (Auditors Report)

Order, 2020 (CARO) issued by Central Government in terms of section 143(11) of the Act, to be included in Auditors report, according to the information and explanations given to us, and based on the CARO reports issued by us for the Holding Company and based on our consideration of CARO reports issued by respective auditors of the companies included in consolidated financial statements, we report that there are no qualifications or adverse remarks in these CARO reports.

Annexure A to the Independent Auditors Report

Annexure A to the Independent Auditors Report on the Consolidated Financial Statements of

Bajaj Finserv Ltd. for the year ended 31 March 2025

(Referred to in paragraph 23.6 under Report on other legal and regulatory requirements section of our report of even date)

Report on the Internal Financial Controls with reference to the aforesaid consolidated financial statements under clause (i) of sub-section 3 of section 143 of the Companies Act, 2013 (the Act)

Opinion

1. In conjunction with our audit of the consolidated financial statements of Bajaj Finserv Ltd. as of and for the year ended 31 March 2025, we have audited the internal financial controls with reference to the consolidated financial statements of Bajaj Finserv Ltd. (the Holding Company) and its subsidiary companies, its associate companies and its joint venture company, which are companies incorporated in India, as of that date.

2. In our opinion, the Holding Company, and its subsidiary companies, its associate companies and its joint venture company, which are companies incorporated in India, have, in all material respects, an adequate internal financial controls with reference to the consolidated financial statements and such internal financial controls were operating effectively as at 31 March 2025, based on the internal controls over financial reporting criteria established by the respective companies considering the essential components of such internal controls stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India (the Guidance Note).

Managements responsibility for internal financial controls

3. The respective Board of Directors of the Holding Company, its subsidiary companies, its associate companies and its joint venture company, which are companies incorporated in India, are responsible for establishing and maintaining internal financial controls with reference to consolidated financial statements based on the internal controls over financial reporting criteria established by the respective companies considering the essential components of internal control stated in the Guidance Note.

These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the respective companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditors responsibility

4. Our responsibility is to express an opinion on the Holding Company, its subsidiaries, its associates and joint venture, which are companies incorporated in India, internal financial controls with reference to the consolidated financial statements based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing (SAs), prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls with reference to the consolidated financial statements. Those SAs and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls with reference to the consolidated financial statements were established and maintained and if such controls operated effectively in all material respects.

5. Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference to the consolidated financial statements and their operating effectiveness. Our audit of internal financial controls with reference to the consolidated financial statements included obtaining an understanding of internal financial controls with reference to the consolidated financial statements, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of the internal controls based on the assessed risk. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error.

6. We believe that the audit evidence we have obtained, and the audit evidence obtained by the other auditors in terms of their reports referred to in the Other matters paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the internal financial controls with reference to the consolidated financial statements.

Meaning of internal financial controls with reference to the consolidated financial statements

7. A Holding Companys internal financial controls with reference to the consolidated financial statements is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A companys internal financial controls with reference to the consolidated financial statements includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and Directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the Companys assets that could have a material effect on the financial statements.

Inherent limitations of internal financial controls with reference to the consolidated financial statements

8. Because of the inherent limitations of internal financial controls with reference to the consolidated financial statements, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls with reference to the consolidated financial statements to future periods are subject to the risk that the internal financial controls with reference to the consolidated financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Other matters

9. The auditors of Bajaj Allianz Life Insurance Company Ltd. (BALIC), a subsidiary, have reported in their main audit report that determination of the following as at 31 March 2025 is the responsibility of the BALICs Appointed Actuary (the Appointed Actuary) -

a. The actuarial valuation of liabilities for life policies in force and for policies in respect of which premium has been discontinued but liability exists. The actuarial valuation of these liabilities has been duly certified by the Appointed Actuary and in his opinion, the assumptions for such valuation are in accordance with the guidelines and norms issued by the Insurance Regulatory and Development Authority of India (IRDAI) and the Institute of Actuaries of India in concurrence with the IRDAI;

b. Other adjustments and judgments, confirmed by the Appointed Actuary in accordance with Indian Accounting Standard 104 - Insurance Contracts are as under:

i. Assessment of contractual liabilities based on classification of contracts into insurance contracts and investment contracts;

ii. Valuation and classification of deferred acquisition cost and deferred origination fees on investment contracts;

iii. Grossing up and classification of the reinsurance assets and;

iv. Liability adequacy test as at the reporting dates.

Our opinion on the consolidated financial statements is not modified in respect of the above matters.

10. As reported in the main audit report for Bajaj Allianz General Insurance Company Ltd. (BAGIC), a subsidiary, the actuarial valuation of liabilities in respect of claims Incurred But Not Reported (IBNR) and claims Incurred But Not Enough Reported (IBNER) is the responsibility of BAGICs Appointed Actuary.

The actuarial valuation of these liabilities as at 31 March 2025 has been duly certified by the Appointed Actuary. The Appointed Actuary has also certified that in his opinion, the assumptions for such valuation are in accordance with Ind AS 104 Insurance Contracts, Ind AS 109 Financial Instruments, guidelines and norms, issued by Insurance Regulatory and Development Authority of India (IRDAI) and Institute of Actuaries of India in concurrence with the IRDAI. We have relied upon Appointed Actuarys certificate in this regard for forming our opinion.

Our opinion on the consolidated financial statements is not modified in respect of the above matter.

11. Our aforesaid report under section 143(3) (i) of the Act on the adequacy and operating effectiveness of the internal financial controls system with reference to the consolidated financial statements in so far as it relates to fourteen subsidiary companies, two associate companies and one joint venture company, which are companies incorporated in India, is based on the corresponding reports of the auditors of such subsidiaries, associates and joint venture incorporated in India.

For KKC & Associates LLP

Chartered Accountants

(formerly Khimji Kunverji & Co LLP)

ICAI Firm Registration Number: 105146W/W100621

Ketan S Vikamsey

Partner

ICAI Membership Number: 044000

UDIN: 25044000BMOXIF7711

Pune : 29 April 2025